Applied Digital Corporation APLD shares are trading higher Tuesday after the company secured a significant $5 billion financing agreement with Macquarie Asset Management to fund the growth of its high-performance computing (HPC) data centers.
What To Know: The deal will involve MAM investing up to $900 million in the Ellendale HPC Campus and grants MAM the right to invest an additional $4.1 billion in Applied Digital’s future HPC projects. Applied Digital will retain an 85% ownership stake in its HPC assets, minimizing dilution to public stockholders.
The financing is expected to help Applied Digital complete the 400 MW Ellendale HPC Campus, repay existing debt and further expand its HPC data center pipeline. The company is positioning itself as a leader in the HPC sector, aiming to meet the rising demand for AI and other advanced computing applications.
The agreement includes a 12.75% dividend on the preferred equity investment, which increases after five and six years. Applied Digital plans to use the funds for construction, platform expenses and to recover equity investment, while also ensuring the development of additional projects within the HPC sector.
APLD Price Action: Applied Digital shares were up 11.6% at $8.69 at the time of writing on Tuesday, according to Benzinga Pro.
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